The CBO’s updated fiscal outlook gives the GOP little cause for concern. Republican lawmakers dismissed the CBO analysis that the Tax Cuts and Jobs Act will add $1.9 trillion to the debt over the next decade. Pennsylvania Sen. Pat Toomey “totally disagrees” with the projections, asserting that the tax cuts will add to government revenue. Sen. Tim Scott of South Carolina says “there’s no question that our deficit will go down over time.” Said Marc Goldwein of the Committee for a Responsible Federal Budget: “It’s a lot easier to impugn the referee than change our policies.”
But the GOP (and everybody else) should be worried. Very worried. TPC’s Bill Gale explains that the outlook is far worse than it appears. “The projected budget deficits in the coming decade are essentially “full-employment” deficits…. From 1965-2017, full employment deficits averaged just 2.3 percent of GDP, far lower than either our current deficit or the ones projected for the future… As President Kennedy once said ‘the time to repair the roof is when the sun is shining.’ Instead, we are punching more holes in the fiscal roof.”
As if that isn’t enough. TPC’s Howard Gleckman explores some other nuggets and caveats in the budget forecast. Among them: When CBO assumes that the expiring provisions of the TCJA are extended, and discretionary spending rises with inflation, the debt would rise by nearly $2.5 trillion over the next decade and the deficit will be $500 billion bigger in 2028 alone.
A fair share of same-sex couples may be uncertain about their tax filing status. A Credit Karma Tax survey found that nearly three out of four respondents didn't know about IRS guidance on how same-sex couples can file federal tax returns. That means that couples could miss out on some tax breaks. The IRS recognizes gay marriages but not civil unions or domestic partnerships.
Trade war, no trade war. Chinese president Xi Jinping seemed to lower tensions yesterday. While he did not address President Trump’s tariff threats directly, Xi backed more protection for intellectual property and said foreign financial and manufacturing firms would get increased access to Chinese markets. Both are major demands of the Trump Administration.
A new chair for the Senate Appropriations Committee. Richard Shelby (R-AL) will replace Thad Cochran (R-MS), who retired due to poor health.
A new tax scam in Connecticut, under the guise of Amazon. Connecticut’s department of revenue warns the state’s taxpayers to ignore email claiming to be a use tax bill for Amazon or NewEgg purchases. The fraudulent email tells taxpayers to visit a scam website that collects payments and personal financial information.
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